Annual Analyst/Investor Conference September 6, 2007 New York Safe - - PDF document

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Annual Analyst/Investor Conference September 6, 2007 New York Safe - - PDF document

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1 Annual Analyst/Investor Conference September 6, 2007 New York Safe Harbor This presentation and managements public commentary contain certain forward-looking statements that are subject to risks and uncertainties. These statements are

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Annual Analyst/Investor Conference September 6, 2007 – New York

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Safe Harbor

This presentation and management’s public commentary contain certain forward-looking statements that are subject to risks and uncertainties. These statements are based on management’s current knowledge and estimates of factors affecting the Company’s

  • perations. Statements in this presentation that are forward-looking include, but are not limited

to, the statements regarding broadcast pacings, publishing advertising revenues, along with the Company’s earnings per share outlook for the first quarter and full fiscal year 2008. Actual results may differ materially from those currently anticipated. Factors that could adversely affect future results include, but are not limited to, downturns in national and/or local economies; a softening of the domestic advertising market; world, national, or local events that could disrupt broadcast television; increased consolidation among major advertisers or other events depressing the level of advertising spending; the unexpected loss or insolvency of one

  • r more major clients; the integration of acquired businesses; changes in consumer reading,

purchasing and/or television viewing patterns; increases in paper, postage, printing, or syndicated programming costs; changes in television network affiliation agreements; technological developments affecting products or the methods of distribution; changes in government regulations affecting the Company’s industries; unexpected changes in interest rates; and the consequences of any acquisitions and/or dispositions. The Company undertakes no obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise.

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  • Strategic Overview

Steve Lacy

  • Broadcasting Overview

Paul Karpowicz

  • Publishing Overview

Jack Griffin Break

  • Integrated Marketing

Wendy Riches

  • Interactive Media

Lauren Wiener

  • Financial Update

Suku Radia

  • Q&A

All

Agenda

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A Decade of Media Platform Growth

Late 1990’s 2002

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A Decade of Media Platform Growth

2003 2005 2006

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  • Core businesses

– Creative – Circulation – News expansions – Brand building

  • Online expansions

– BHG.com – Parents.com – Broadcasting sites

  • Meredith Video Solutions

Fiscal 2007 Investment Activity

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Portfolio Management

  • Acquisitions

– O’Grady Meyers – Genex – New Media Strategies – ReadyMade – Healia

  • Divestitures

– Child – Bend – Chattanooga (in process)

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Great Brands and Properties

  • 25 subscription magazines
  • 180 special interest publications
  • 13 television stations
  • 40+ Web sites
  • 400 books
  • Marketing relationships with

America’s leading companies

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Broad Customer Reach

  • 85 million name database
  • 75 million monthly magazine readers
  • 10 percent of U.S. television households
  • 12 million monthly unique online visitors
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Strong Online Businesses and Brands

  • 43 Web sites: 25 Publishing; 18 Broadcasting
  • 12 million unique visitors monthly
  • 150 million page views monthly
  • 2.8 million Internet subscriptions
  • More than 1 million video clips streamed monthly
  • Operating profit up more than 50%
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Growth Strategies

  • Maximize margin opportunity in Broadcasting
  • Strengthen and grow Publishing business and brands
  • Integrate and expand custom marketing businesses
  • Expand online and video platforms
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September 6, 2007 – New York Broadcasting Overview Paul Karpowicz President, Meredith Broadcasting Group

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Meredith Broadcasting Group

Kansas City Phoenix Flint-Saginaw Atlanta Hartford Nashville Las Vegas Greenville Portland Springfield New York Des Moines

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Broadcasting Growth Strategies

  • Increase and monetize ratings

– Expand and improve news – Execute sales strategies

  • Grow new revenue streams

– Capitalize on Web potential – Develop Meredith Video Solutions

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Expand and Improve News

Nielsen—May 2002 and 2007 household audience share Monday-Friday 6-7 a.m. morning news

Morning News

May 2002 May 2007 Portland – FOX Las Vegas – FOX Hartford – CBS Nashville – NBC Kansas City - CBS 17 7 30 20 14 33 12 34 24 16

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Expand and Improve News

Ad Rate Share Rating Ad Rate Share Rating 13 10 7 6.7 5.9 3.6 8 6 6 4.5 3.7 3.3 $600 $400 $650 Portland Phoenix Atlanta $700 $1,250 $850 May 2002 May 2007

Ad rate = cost for a 30 second spot Source: Nielsen HH Share

Late News - Big 3 Markets

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29.0% 35.0% 37.0%

2003 2005 2007

Monetize ratings growth

Revenue EBITDA Margin

$ in millions

2003 2005 2007

$270 $310 $350 2007 2005 2003 $350

37.7%

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Capture Early Political Dollars

  • Meeting with all key agencies
  • Create pro-active presentations on maturing FOX demos
  • Discuss Web site advertising with agencies and candidates
  • Hold Washington D.C. reception in late September 2007

Action Steps

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Grow New Revenue Streams

$3 $11 $37 2001 2003 2005 2007 $ in millions, includes Cornerstones and branded promotions, local initiatives, online, retransmission fees and Meredith Video Solutions

Fiscal Year

$56

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Capitalize on Web Potential

  • Invested in new technology
  • Redesigned all Web sites
  • Added dedicated creative personnel
  • Hired dedicated Internet sellers

Results

  • Traffic up significantly
  • Revenues more than doubled in FY2007

Enhance Broadcasting Sites

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Capitalize on Web Potential

6 10 2003 2005 2007

Average monthly page views

35% CAGR

Broadcasting Internet Page Views

5 million 10 million 17 million

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Develop Meredith Video Solutions

  • Better.tv
  • www.BHG.com
  • Parents.tv
  • www.parents.com

Better television show

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Develop Meredith Video Solutions

Collaborative Approach

  • Publishing brands, content and promotion
  • Broadcasting resources and production expertise
  • Interactive Media traffic, sales and platform
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  • Channels include:

– “Doc Talk” – “It Moms” – “New Moms Club”

  • Producing new content monthly
  • Building library of assets
  • Over 20 channels
  • Library of over 1,000 video assets
  • 2-30 minute segments
  • Producing 20 hours a week

Develop Meredith Video Solutions

Content Strategy and Development

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  • Broadband network:

– Advertising spots – Sponsorships – Product placement

  • Television show:

– Local advertising – Sponsorships – Product placement – Syndication to other groups

Develop Meredith Video Solutions

Monetizing the Better Brand

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Broadcasting Growth Strategies

  • Increase and monetize ratings

– Expand and improve news – Execute sales strategies

  • Grow new revenue streams

– Capitalize on Web potential – Develop Meredith Video Solutions

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Publishing Update Jack Griffin President, Meredith Publishing Group September 6, 2007 – New York

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Meredith Publishing Group

Meredith Speaks to Women on Subject Matter They Care About Most

19 MILLION

YOUNG ADULTS

20 MILLION

EARLY EMPTY NESTERS

13 MILLION

YOUNG FAMILIES

29 MILLION

ESTABLISHED FAMILIES

75 Million Women at Every Adult Lifestage

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Advertising Category Mix

4% 5% Travel 4% 4% Retail 11% 7% Cosmetics 11% 24% Home 3% 17% 7% 12% Calendar 2001 6% Non-DTC 12% Direct Response 13% Pharmaceutical 19% Food Calendar 2007

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Publishing Growth Strategies

  • Grow magazine business

– Enhance vibrancy of brands – Build on strengthening sales performance

  • Expand and integrate custom marketing business
  • Expand online and video platforms
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Enhance Vibrancy of Brands

  • Re-crafted editorial product

– Readership up 5-10 percent

  • Improved advertising performance
  • Stabilized circulation

– Renewal rates up 5 percent – Newsstand sales up 8 percent

  • Relaunched BHG.com
  • Expanded brand licensing activities

– Universal Furniture – International

Better Homes and Gardens

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  • 11.9%
  • 8.1%
  • 7.5%
  • 1.8%

Enhance Vibrancy of Brands

Q1 Q2 Q3 Q1 Q2 Q3

+13.7% +10.0%

Calendar 2006:

  • 7.0%

Calendar 2007 (YTD): +8.5%

Better Homes and Gardens Advertising Revenues

Q4

+6.4%

E E

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Enhance Vibrancy of Brands

Family Circle

  • Creative improvements

– Editorial – Design

  • New sales and marketing leadership
  • Circulation initiatives

– Increased Direct-to-publisher subscriptions from 30% to 60% – Newsstand improvements

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  • 12.0%
  • 0.8%

19.0% 14% 26.0% 10.0% 13.0%

Enhance Vibrancy of Brands

Q1 Q2 Q3 Q1 Q2 Q3

+

Calendar 2006: +4.7% Calendar 2007 (YTD): +16%

Family Circle Advertising Revenues

Q4

+ + + + E E

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Enhance Vibrancy of Brands

Parents

  • New sales leadership
  • Circulation initiatives
  • Enhanced brand marketing

– Parents.com – Parents.tv – Product licensing

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  • 3.3%
  • 3.4%
  • 3.2%
  • 11%
  • 4.4%

35.0% 1.8%

Enhance Vibrancy of Brands

Q1 Q2 Q3 Q1 Q2 Q3 Calendar 2006:

  • 5.1%

Calendar 2007 (YTD): +11.5%

Parents Advertising Revenues

Q4

+ + E E

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Enhance Vibrancy of Brands

2006 Magazine of the Year

More

  • Outstanding creative and

advertising leadership

  • Rate base increases
  • Web site development
  • Social networking

– More Model Search – More Marathon – Online

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19% 27% 14% 31% 27% 29% 29%

Q1 Q2 Q3 Calendar 2006: +22% Q1 Q2 Q3 Calendar 2007 (YTD): +28%

Enhance Vibrancy of Brands

More Advertising Revenues

Q4

E E + + + + + + +

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Strengthening Sales Performance

+8% +28% +11.5% +16% +8.5% January - September 2007 0% +22% (-8%) 0% (-7%) January - September 2006

Parents TOTAL GROUP More Family Circle BHG

Advertising Revenues: Calendar Year-to-Date

Calendar issues

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Strengthening Sales Performance

  • Expanded corporate

sales group

  • Aggregated sales and

marketing creative resources

  • Created Meredith 360°
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Strengthening Sales Performance

Meredith 360° Case Study - GE Lighting

Custom video content Experiential High impact inserts Purchase Incentive Rich media Hand-raising effort P-O-P displays Film production On-pack promotion Custom research

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Publishing Growth Strategies

  • Grow magazine business

– Enhance vibrancy of brands – Build on strengthening sales performance

  • Expand and integrate custom marketing business
  • Expand online and video platforms
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Meredith Integrated Marketing Wendy Riches Executive Vice President September 6, 2007 – New York

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Meredith Integrated Marketing

  • Strong heritage of custom

publishing

  • Deep breadth of services
  • Transformative growth underway
  • Not dependent on advertising
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Strong Heritage of Custom Communications

  • Term: 3 years
  • Custom magazine

– 5 times a year – 10 million circulation – Multiple versions

  • Email content

Kraft Food & Family

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Deep Breadth of Services: Nestlé

Measurement Tools Sampling Gift Pack Portfolio Website Versioned Communications Partnership Development DVD

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Transforming Meredith Integrated Marketing

CUSTOM PUBLI SHER

RELATI ONSHI P MARKETER

Brand Messaging Brand Marketing Awareness/Imagery/ Propensity to purchase Calls to action; Purchase triggers Responsive/Executional Proactive/Strategic Ink-on-paper/magazine Turn-key, flat fee solutions Fees, based on blended rates

Vendors Partners

Discipline-neutral (mail; e-marketing; magazines)

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Transforming Meredith Integrated Marketing

  • Acquired in April, 2006
  • 60 employees
  • Interactive AoR for Nestlé USA
  • Expertise includes:

– CRM strategy online – E-branding – Web site design and build

  • Strength in packaged goods

*AOR: Agency of Record

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  • Acquired in January, 2007
  • 120 employees
  • Expertise includes

– User experience – Web site architecture – Online application development – Leading edge visual design

  • Strength in financial services, auto

Transforming Meredith Integrated Marketing

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  • Acquired in January, 2007
  • 70 employees
  • Expertise:

– Word-of-mouth campaigns – Online brand promotion and protection – Viral marketing

Transforming Meredith Integrated Marketing

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The “New” Meredith Integrated Marketing

MI M (pre-OGM)

Custom Publishing — Content and Editorial Expertise

OGM

E-CRM Strategy — Web site design and build — E-Branding

Genex

Web site architecture — Application development — Leading edge visual design

NMS

WOM — Viral — Online Research — Consumer Monitoring

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Significant Non-Advertising Revenue Growth

100 171 212 235 2003 2004 2005 2006 2007 Fiscal Year

Meredith Integrated Marketing Revenues

297

31% CAGR

Indexed to 2003

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Meredith Integrated Marketing

  • Strong heritage of custom

publishing

  • Deep breadth of services
  • Transformative growth underway
  • Not dependent on advertising
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Meredith Interactive Media Lauren Wiener Vice President September 6, 2007 – New York

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Increase Traffic and Loyalty

47 95 117 2003 2005 2007 Fiscal Years

29% CAGR

Publishing Internet Page Views

130

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Continue Aggressive Revenue & Profit Growth

45% CAGR

Meredith does not break out results for specific profit centers

Operating Profit

100 2005 2006 2007 2005 2006 2007 Fiscal Years Fiscal Years 150 210 1,450 875 100

Revenue

280% CAGR

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Continue Aggressive Revenue & Profit Growth

2003 2005 2007

Internet-Sourced Subscriptions

800K 1.4M 2.8M

2003 2005 2007

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Expand Online and Video Platforms

  • Strengthen position in core categories
  • Expand into complementary categories
  • Increase traffic and loyalty
  • Aggressively grow revenue and profit

Growth Initiatives

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Strengthen Position in Core Categories

  • Redesign Results

– Page views up 15 percent to 75 million – Time spent per visitor up 12 percent – Video streams up from 25k to 650k – Advertising revenues up 50 percent

Relaunch Flagship Site: BHG.com

  • Action Taken

– New tools and guides – Video library – 10 editor blogs, updated daily

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  • Combines American Baby, Parents,

Child and Family Circle brands

  • Brand positioning: From crib to

college, more parents more solutions

  • Personalization capabilities
  • Strong community tools
  • Broadband home for Parents.tv

Strengthen Position in Core Categories

Create Parenthood portal

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Expand into Complementary Categories

  • Consumer search engine
  • Focused on health
  • Unique technology
  • Strong strategic fit

– Fast-growing category – Web under-utilized by advertisers

Health & Well-Being: Healia

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Expand Online and Video Platforms

Growth Initiatives

  • Strengthen position in core categories
  • Expand into complementary categories
  • Increase traffic and loyalty
  • Aggressively grow revenue and profit
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Financial Update Suku Radia Chief Financial Officer September 6, 2007 – New York

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Outstanding EPS Growth

$1.59 $2.00 $2.50 $2.87 2003 2004 2005 2006 2007

Fiscal 2003-2006 - Diluted EPS from continuing operations before cumulative effect of changes in accounting principles Fiscal 2007 – Diluted core earnings per share

$3.29

20% CAGR

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Strong Cash Flow

*Defined as net earnings plus depreciation and amortization less capital expenditures excluding special items

$ in millions

200 Stock Option Exercises $2,000 Utilization of Cash 200 Dividends 600 Share Repurchases $1,200 Acquisitions, Net of Dispositions $2,000 Available Cash 200 Deferred Taxes 500 Net Debt $1,100 Free Cash Flow

Fiscal 1998 through Fiscal 2007

*

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Current Debt Structure

  • $460 million total debt
  • 5.0% cost of debt
  • 1.3x debt to EBITDA
  • 3.75x maximum debt to EBITDA

As of July 31, 2007

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$0.26 $0.28 $0.30 $0.32 $0.34 $0.36 $0.38 $0.48 $0.56 $0.64 $0.74

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007E

Return Capital to Shareholders

11% CAGR

Calendar Year Dividends Per Share

E E = Estimated

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$390 $342 $197 $99 $62 $30 2002 2003 2004 2005 2006 2007

Return Capital to Shareholders

$ in millions

$400

Fiscal Year Share Repurchases Cumulative

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Fiscal 2008 Outlook

  • Publishing

advertising revenue

  • Broadcast

pacings

  • Q1 Fiscal 2008

earnings per share

  • Fiscal 2008

earnings per share $0.67 $3.50-$3.55

September 2007

Up Low double digits Down Mid-to-high single digits

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Summary: Growth Strategies

  • Maximize margin opportunity in Broadcasting
  • Strengthen and grow Publishing business and brands
  • Integrate and expand custom marketing businesses
  • Expand online and video platforms
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Annual Analyst/Investor Conference September 6, 2007 – New York